AG settles for $2.4 million with company that overcharged government entities

State Attorney General Eric Schneiderman announced a $2.4 million settlement today with Stericycle Inc., one of the country’s largest medical waste disposal companies, for overcharging almost 1,000 government entities in New York. The settlement impacts fire departments, rescue squads, schools, jails and hospitals across the state, including in Harrison and Bedford Hills. The company implemented a plan to charge automated price increases in 2003 without giving notice to customers, a violation of contract terms, according to the Attorney General’s Office.

As part of the settlement, every government entity that was overcharged will receive a check from Stericycle that covers all of the overcharged amount. The total the company will pay to is $820,000, and it will discontinue its automated price hikes to its New York customers covered by the settlement. In the future, the company will provide notice of increases and an opportunity to opt out before they take effect.

“Stericycle improperly profited by overcharging New York taxpayers,” Schneiderman said in a statement. “In these times of harsh budget cuts to education, public health, and public safety, local governments and agencies need every available dollar and we will hold accountable corporations like Stericycle that use cynical schemes to rip off New York taxpayers.”

The case was brought under and investigated pursuant to the New York False Claims Act, the attorney general said. Jennifer Perez, a former Stericycle employee, filed a whistleblower complaint about the company’s automated increases in federal District Court in Chicago. Under the New York False Claims Act, the whistleblower receives a portion of the recovery, although that doesn’t impact the recovery of actual damages, Schneiderman said.

These are the top five taxpayer-funded entities in the Lower Hudson Valley and the compensation they will receive:

Cara Matthews is a member of The Journal News' Tax Team. She has worked as an Albany correspondent and she covered Putnam County government and politics. Before that, she worked at newspapers in Connecticut and covered the state Legislature for one of them.